President Donald Trump announced steep tariffs on all automobiles manufactured outside the United States on Wednesday, in a move that Canadian leaders called a "direct attack."
While Prime Minister Mark Carney has yet to announce any retaliatory measures, the newly sworn-in Canadian leader promised to hold firm in the face of Trump's desire for a trade war.
"This is a very direct attack," Carney said, per the Associated Press. "We will defend our workers. We will defend our companies. We will defend our country."
Trump told reporters that the duties will "spur growth" in domestic manufacturing. However, the sudden announcement of a 25% tariff on imported vehicles and key automobile parts is likely to throw a wrench in the production of domestic vehicles, as the manufacturing process of American cars is deeply intertwined with factories in Mexico and Canada. As U.S. car companies navigate a new normal and the costs of imported parts and vehicles continue to rise, American consumers will likely see an increase in the sticker price of new cars.
Ontario Premier Doug Ford said the tariffs "will do nothing more than increase costs for hard-working American families" in a post to X.
"U.S. markets are already on the decline as the president causes more chaos and uncertainty," he wrote. "He’s putting American jobs at risk."
Trump has been dancing around imposing tariffs on Mexico and Canada since he took office in January. His push to punish the United States' biggest trading partners has thrown projections of the performance of the U.S. economy into chaos, as economists predict pain in the short term.
"I think it would be extremely difficult to find, if not impossible, frankly, to find a car that is entirely made in Canada or entirely made in the U.S. — or entirely made in Mexico, for that matter," economist Tu Nguyen told the CBC earlier this year, in response to Trump's threats.
The response to Trump's tariffs was not entirely negative. United Auto Workers President Shawn Fain praised the president for ending "the free trade disaster that has devastated working-class communities for decades."
"Ending the race to the bottom in the auto industry starts with fixing our broken trade deals, and the Trump administration has made history with today’s actions,” he shared in a statement.
